SABMiller plc, the owner of Miller Brewing Co., has agreed to buy the Dutch brewer of Grolsch for $1.2 billion.

London-based SABMiller and Koninklijke Grolsch NV announced a conditional agreement for a public cash offer for all outstanding shares of Grolsch for 48.25 euros per share, or 816 million euros. Grolsch's annual sales are more than 300 million euros, or about $440 million.

SABMiller said it does not anticipate a change to existing distribution agreements in the U.S., UK, Canada, Australia, and certain smaller markets at this time. Anheuser-Busch is the exclusive U.S. importer of Grolsch, which includes the entire Grolsch brand line-up, including the small, but growing Grolsch Amber Ale, Grolsch Light Lager and Grolsch Blonde Lager.

Grolsch is an iconic Dutch beer brand with nearly 400 years of brewing heritage and a strong position in the Netherlands. Grolsch is positioned as a true Dutch beer brewed to an original recipe and sold in a distinctive green bottle with a reclosable cap. Grolsch Premium Pilsner accounts for more than 90 percent of its sales. The brewer also produces Grolsch Premium Weizen, Spring Bock and Autumn Bock as well as the Amsterdam brand.

The deal requires various shareholder and regulatory approvals. The public offering is slated for early in 2008.

SABMiller plans to grow the Grolsch brand, most notably in Africa and Latin America, as well as in Central and Eastern Europe. Production is expected to increase at its brewery in Enschede, Netherlands, where Grolsch is based.

SABMiller has an agreement with Molson Coors Brewing Co. of Denver to merge Milwaukee-based Miller with Coors Brewing Co. of Golden, Colo., in a joint venture called MillerCoors that will be 58 percent owned by SABMiller. Management control of the venture will be shared equally by SABMiller and Molson Coors.